Guizhou Zhenhua E-chem (SH:688707) Guotai Junan Securities·2024-05-06 07:33Investment Rating - The report maintains a rating of "Buy" for the company, with a target price set at 18.61, down from a previous forecast of 29.00 [9][10]. Core Views - The company is experiencing short-term performance pressure due to industry destocking and capacity utilization rates, but there is optimism regarding the contribution of sodium-ion battery materials to future performance [9][10]. - The company has achieved significant advancements in sodium-ion battery cathode materials, establishing a leading advantage in shipments and securing comprehensive cooperation with major domestic battery cell customers [9][10]. - The report highlights a substantial decline in revenue and net profit for 2023, with revenue at 6.876 billion and a net profit of 103 million, reflecting a year-on-year decrease of 51% and 92% respectively [9][10]. Financial Summary - For 2023, the company reported total revenue of 6,876 million, a decrease of 51% year-on-year, and a net profit of 103 million, down 92% [9][11]. - The company's EBIT for 2023 was 182 million, representing an 88% decline compared to the previous year [9][11]. - The report projects a recovery in revenue to 11,570 million by 2026, with a significant increase in net profit expected to reach 445 million [9][11]. Performance Metrics - The report indicates a revenue growth rate of -51% for 2023, with expectations of a rebound in subsequent years [9][11]. - The company's gross profit margin for 2023 is noted at 2.6%, with projections for improvement to 5.6% by 2026 [9][11]. - The return on equity (ROE) is projected to rise from 2.6% in 2023 to 7.6% by 2026, indicating a positive trend in profitability [9][11].